The futures contracts we offer are contracts between two parties, obliging the buyer to buy and the seller to sell 1 USD at a future point in time (expiration date) at a price agreed upon (price of transaction). No actual transaction on USD takes place at expiration, the contracts are financially settled in BTC. These contracts correspond to the ones known from OKCoin and BitMEX and from regular non-Bitcoin derivatives exchanges, such as CME and Eurex.

Currently, there are at least 3 contract maturities, expiring on **Fridays 8:00 UTC**

- weekly, expiring every Friday
- monthly, expiring on last Friday of the month
- quarterly, expiring on last Friday of March, June, September and December

Usually, there is also a bi-weekly contract, whenever it is different than the monthly contract.

Quedex supports two notation styles. The exchange matching engine operates in *bitcoin* notation, natural to
bticoin-centric exchange. It treats Bitcoin as the home currency, and prices the contracts

- in units of home currency, i.e. BTC
- per one unit of foreign currency notional, i.e. US Dollar

Thus price is expressed in BTC per 1 USD (e.g. a contract might have a BTC price of 0.0025 BTC, so its total value is
`0.0025 * 1 = 0.0025 BTC`

.

For convenience, the website and the web app uses *inverse notation*. This means that:

- Price of the contract is expressed in USDBTC (
`price in USDBTC = 1 / price in BTCUSD`

), i.e. the inverse of its bitcoin price. - When price is inverted, the sides of the contracts change. Buying a futures in inverse notation corresponds to selling it in bitcoin notation - conversely, selling in inverse notation amounts to buying it in bitcoin notation.

Inverse notation is also used in quoting OKCoin futures and BitMEX XBU contract. For more details, please consult the inverse notation specification.

Everywhere in calculations, if not stated otherwise, we use

Futures on Quedex are margined (read more on margining), which means that you don't have to deposit the
full contract value in order to open a position, only the *margin* (`= BTC price * notional amount * margin requirement`

). This means that trading them involves leverage.

margin requirement of 0.2 (or 20%) means up to 5x leverage (because

`1/0.2 = 5`

). In this case you have to
deposit only 20% of the contract's value.
When trading a futures contract, you don't have to deposit the full contract value, only the margin, but you receive
**profit and loss** (P/L), resulting from the contract's price change, with respect to the whole contract value (`P/L = BTC price change * notional amount`

). See how it is exactly calculated in margin and P/L
calculations below.

The contracts are settled on the expiration date immediately after the Closing Auction.
Currently, all futures are financially settled, which means that no USD is transferred. The P/L is calculated as
usually, but the last time it is calculated it uses the settlement price instead of last price. How settlement price is
calculated is explained in the *settlement* article.

Margin for an open position and a pending order is calculated as follows:

`margin = margin percent * BTC price * notional amount * quantity`

where:

`margin`

- initial or maintenance margin`margin percent`

- initial or maintenance margin percent, respectively (value available on contract's details page)`BTC price`

- current contract's BTC price when calculating margin of an open position; limit BTC price for buy orders and max(limit BTC price, best buy BTC price) for sell orders`notional amount`

- number of units of the underlying`quantity`

- either position or order quantity

and P/L for open position:

```
P/L = positions side sign * (last BTC price - trade BTC price)
* notional amount * quantity
```

where:

`position side sign`

- +1 for long position (you've bought the contract) and -1 for short position (you've sold the contract)`last BTC price`

- BTC price of the last trade or TAP during auction`trade BTC price`

- BTC price at which the position was opened`notional amount`

- the same as for margin calculation